Voice of the White House
August 1, 2019
Washington, D.C.: The strait of Hormuz is the kink in the hose of the Gulf’s oil supply to the world. A small amount of pressure can have a disproportionate effect, sending world crude prices soaring and starving the world’s oil-dependent economies.
At its narrowest point, between the Oman peninsula and the Iranian islands off Bandar Abbas, the strait is 20 miles wide, but the channels down which more than a third of the world’s ocean-borne oil flows – 17m barrels a day – are even more tenuous. The tanker lanes going in each direction are just 2 miles wide in parts, through the deep water off Oman and then again, further west, inside Iranian territorial waters.
This is where oil tankers are most vulnerable to an Iranian attempt to turn off the global petrol pump. It was enough for an Iranian official to simply raise the prospect of closing the strait, in retaliation for the threat of sanctions, for the world price of crude to rise to $115 (£74) a barrel. Maintained over the long term, that is costly enough to strangle any hint of a global economic recovery.
That is what makes Iranian naval action in the Gulf such a potent weapon. But it is a decidedly double-edged one, potentially more lethal to Iran than its adversaries. For, while Saudi Arabia can bypass the strait by pipeline, all of Iran’s oil terminals are west of the choke point. Iran would cut off its own lifeblood, which accounts for more than 60% of its economy.
Furthermore, the US has made clear that interruption to sea traffic in the Gulf would be a “red line”, triggering an overwhelming military response in which Iran’s nuclear facilities would be on the target lists. Until now, the US military has ruled out strikes on the nuclear programme, as the costs of starting a war with Iran outweigh the gains of setting the programme back, one or two years at most. But if the US was going to war anyway over oil, that cost-benefit analysis would change.
So closing the strait outright would be – if not suicidal – an exercise in extreme self-harm for Iran. But the choice facing Tehran is not a binary one.
There is a spectrum of options falling well short of total closure; forms of harassment of the oil trade that would drive the price of crude up and keep it up, very much to Iran’s benefit, but fall short of a casus belli. However, exercising such options requires subtlety and fine judgment on all sides and that is by no means a given.